My old website of the same name was so outdated that BlueHost, my domain host, suggested that I create a new website from the ground up due to all the technological changes since 2012. Both my old and new websites welcome all public K-12 teachers, but focus explicitly on my old stomping grounds, where I taught for 24 years, the Los Angeles Unified School District.

However, my first post on my new website is also an introduction to what I have been trying to accomplish with this website, my books, and 12 years of blogging and presenting at workshops about investing on my old website: informing my K-12 teacher colleagues about the benefits of saving in their low-cost 403 (b) or 457 (b) plans.

Let’s get started

After 24 years of teaching elementary grades, I’ve learned that some lessons must be repeated again and again — especially when it comes to money. So, class, let’s start with today’s question:

Is insurance an investment?

NO!

I Love My Insurance — for What It’s Meant to Do

Don’t get me wrong. I’m grateful for my insurance policies. I sleep better knowing my home, car, and health are protected. I also carry long-term care, earthquake, and umbrella coverage.
And yes — I happily pay my premiums and even the commissions that come with them. My agents are professionals who help me manage risk.

But here’s the key:
My retirement nest egg is kept 100% separate from my insurance policies and the agents who sell them.

Insurance ≠ Investment

Insurance and investing are like apples and oranges — totally different purposes, tools, and outcomes.

Insurance is a contract. You pay for protection.
Investments are ownership. You accept some risk for the chance to grow your money.

Insurance agents sell policies. They’re trained in protection, not in long-term wealth building. Yet many agents blur the line, using fear to sell “safe” investments that promise you’ll “never lose money.” Sounds comforting, right?

But those guarantees come at a steep price — high fees, sales commissions, and poor long-term returns.

The Real Cost of ‘Never Losing Money’

When insurance is bundled with investments — like in variable annuities or indexed universal life policies — it’s sold as “safety.”
But in reality, these products can cripple your nest egg’s growth over long periods of time.

Over decades, the cost of those guarantees adds up — and the insurance company, not you, gets the best deal.
Remember: guarantees belong in insurance contracts, not investment portfolios.
Real investing requires risk and uncertainty, and that’s a great thing! In fact, it’s the engine of growth.

How I Manage Risk — Like My Pension Plan

Do you know why our teachers’ pensions pay more in benefits than Social Security? Here’s the irony: the very pensions we teachers rely on, like CalSTRS, are built on investments in stocks and bonds — not annuities. Social Security is prohibited by law from investing in stocks.
Pension Plans, foundations, and endowments all invest the same way with stocks and bonds. They embrace risk, manage it smartly, and grow over time.

So why are so many of my K-12 colleagues sold expensive annuities inside their 403(b) or 457(b) plans?
Because they’ve been convinced and will try to convince you that market downturns are “dangerous” — when, in truth, market risk is manageable with a well-balanced portfolio. Do not underestimate how shrewd and persuasive insurance agents are. But by reading this one blog post you are well protected.

The Magic of the Stock/Bond Split

During my teaching years, and now in retirement, my husband and I follow a simple formula:

• Younger years → more in stocks for growth.
• Older years → more in bonds for stability.

That balanced split saved us during the 2008 crash.
It’s the same principle behind Target Retirement Funds — a one-stop shop that automatically adjusts your mix as you age.
No sales pitch. No 10-year surrender charges. Just plain, low-cost investing.

When an Annuity Does Make Sense

There’s one time I’ll tip my hat to insurance in retirement planning:
After you’ve already built your nest egg and want a guaranteed lifetime income stream, an immediate annuity can make sense.
It’s like buying your own private pension.
I didn’t need another annuity because I already have CalSTRS, but for some private sector retirees, it’s a solid choice.

The Final Lesson

Use insurance for what it was designed for:

• Protect your possessions
• Safeguard your family
• Provide peace of mind

Use investments for what they were designed for:

• Grow your wealth
• Beat inflation
• Build freedom

If pension funds, endowments, and universities all invest in stocks and bonds — not annuities — why should teachers, firefighters, or nurses do it any differently?

Steve Bio

Stephen A. Schullo, Ph.D. (UCLA ’96), taught in the Los Angeles Unified School District (LAUSD) for 24 years and at UCLA Extension, teaching educational technology to student teachers.

Steve wrote investment articles for the United Teacher-Los Angeles (UTLA) union newspaper for 13 years. Thrice featured retirement plan advocate in the Los Angeles Times and U.S. News and World Report. He co-founded an investor self-help group 403bAware for teacher colleagues and wrote 7,500 posts in three investment forums since 1997. Frequently quoted by the media, he testified at California State legislative hearings and was honored with the “Unsung Hero” award by UTLA for his retirement planning advocacy.

For the last seventeen years, he serves as a volunteer on LAUSD’s Investment Advisory Committee as a “Member-at-Large” and former co-chair. The committee contains collective bargaining reps from the unions and monitors the district’s tax-deferred retirement plans, 457b/403b, of 55,000 former and current LAUSD employees, worth $3.1 billion in total assets.

He started this blog in 2012 to help all PreK-12 public school educators nationwide, especially his Los Angeles Unified School District colleagues. He belongs to a small national group of 403(b) advocates (mostly teachers) who want to bring closer attention to the 403(b). During the last 25 years, over 40 newspaper articles have been published and each one says the same thing, TSAs (Tax Sheltered Annuities) are terrible 403(b) plans. Over and over again, the articles report that the salesperson gets the benefit from lucrative commissions and high costs. Nobody in educational leadership reads these articles NOR talks about the proper place for annuity products publically. We come together at 403bwise.org. Come on over if you want to join us so we can help our colleagues avoid these self-conflicted retirement plans, TSAs.

For a copy of both books, click on my home page and scroll down to the two books. Click on each book and download it FREE. No obligations as I am not a financial adviser.

Email Steve at steve.schullo@latebloomerwealth.com or ask your question after each post.